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Top Stock Picks 2012 – Q1 Results

Over the past few years, a group of bloggers have enlisted in a friendly competition as to who can pick the best stocks for the year.   As per tradition, we all report quarterly results to see how we are doing relative to each other, and more importantly, the market.

This year, I picked a financial stock (BNS.TO), a big US consumer stock (MMM), a large Canadian minerals company (TCK-B.TO), and a well known Canadian oil company (SU.TO).

Bank of Nova Scotia (BNS.TO) – With Canadian banks retreating from their highs in late 2011, their dividend yields have reached an attractive range. Scotia Bank, with a current yield of approximately 4%,  is known for their international operations and I believe has some upside coming in 2012.  That is providing that we don’t have a global financial meltdown. :) Trading price as of closing Dec 30, 2011: $50.83. Disclaimer: I own shares of BNS.TO.

As I suspected, Canadian financials were oversold at the beginning of the year and most have made a recovery.  Trading price as of March 31, 2012: $55.88. Combined with a $0.55 dividend equates to a return of 11.02% for Q1 2012. Disclaimer: I own shares of BNS.TO.

3M Co. (MMM) –  This company is a great example of a Dividend Achiever where it has increased their dividend for 53 consecutive years with a current yield of 2.69% and P/E ratio of 13.74.  Who is 3M?  They are a  large diversified technology company with seven large divisions.  However, they are likely most well known as the inventor of the Post-It note.  3M shares sold off in late 2011 but it looks like the stock has already started its recovery.  Trading price as of closing Dec 30, 2011: $81.73. Disclaimer: I own shares of MMM.

I picked this one to get exposure to the US market and that it appeared oversold at the beginning of the year. While it hasn’t kept up with the SP500, it has appreciated almost 10%.  Trading price as of March 31, 2012: $89.21. Combined with a $0.59 dividend equates to a return of 9.87% for Q1 2012. Disclaimer: I own shares of MMM.

Teck Resources (TCK.B.TO) –  Teck Resources is my mineral play where the company is engaged in the exploration, development and production of copper, coal, gold and zinc.  It faced a steep decline in 2011 and I believe will start climbing again once confidence in the economy thus commodities returns. Teck currently yields 2.23% with a P/E ratio of 8.92. Trading price as of closing Dec 30, 2011: $35.91. Disclaimer: I own shares of TCK.B.

The most volatile stock in the portfolio brought the lowest return. Trading price as of March 31, 2012: $35.61 equates to a return of -0.84% for Q1 2012. Disclaimer: I own shares of TCK-B.TO.

Suncor Energy (SU.TO) –  Suncor Energy is Canada’s largest integrated energy company.  It has a large stake in the oil sands and is involved in numerous other energy plays across the country. While this is not a huge dividend stock with a yield of 1.50%, I believe that the energy sector is oversold and has a large upside should the buyers return.    Trading price as of closing Dec 30, 2011: $29.38.Disclaimer: I own shares of SU.TO.

Even with the recent pull back of Canadian oil stocks, the energy sector remains strong thus far in the year.  Trading price as of March 31, 2012: $32.59. Combined with a $0.11 dividend equates to a return of 11.30% for Q1 2012. Disclaimer: I own shares of SU.TO.

Overall, the portfolio returned 7.84% for the quarter.  Under normal circumstances, that is a pretty darn good return, but it’s all relative!  The portfolio managed to beat the TSX which returned approximately 5.4% (via XIU.TO).  However, the portfolio was no match for the mighty S&P500 that has been on a tear lately with a return of 12.4% (via XSP.TO).  It appears that some of the other bloggers have had more luck!

Here are the the picks and results from the other bloggers:

  1. Where Does All My Money Go: 35.91%
  2. Intelligent Speculator: 16.37%
  3. Dividend Mantra: 13.71%
  4. Wild Investor: 11.78%
  5. My Traders Journal: 11.17%
  6. Beating The Index: 10.87%
  7. Million Dollar Journey:  7.84%
  8. The Passive Income Earner:  4.77%
  9. Dividend Growth Investor: 4.43%
  10. The Financial Blogger: 0.10%

4 Comments, Comment or Ping

  1. Interesting game you are all playing. Obviously based on your disclaimers you are putting your money where your mouth is and owning shares in each of these stocks.

    Is this competition strictly investing in stocks? Or could you invest in other asset classes such as ETF, mutual funds, or stock options?

    I am curious if you have read any of Nassim Nicholas Taleb’s books and some of the theories he has presented. I have enjoyed the few articles I’ve read from your site. I would like to learn more about investments in Canada. Keep up the good work!

  2. 2. SST

    @Gary: “…invest in other asset classes such as ETF, mutual funds, or stock options?”

    Those items all belong to the same asset class.

  3. Good job MDJ! Those are some nice picks and 7.84% is very good!

    I participating in another stock picks contest by Financial Uproar and came out second last lol.

  4. 4. On Demand

    Nice job FT. I would prefer Warrants than stock options. got some past success from trading warrants in other markets. Is there any article regarding trading warrants in TSE?


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